Merchant navy scam:Ship owner charged with fraudulently claiming Swiss state funds

Merchant navy scam:Ship owner charged with fraudulently claiming Swiss state funds
December 16, 2019 https://www.swissinfo.ch/eng/merchant-navy-scam_ship-owner-charged-with-...

Switzerland has filed charges against a ship owner for allegedly submitting fraudulent claims for state financing guarantees. The 66-year-old is accused of inflating the construction and purchase prices of vessels to unfairly win a bigger credit facility from the Swiss state.

Switzerland underwrites the debts of several ocean-going vessels that make up its merchant navy, which was formed just after the Second World War to guarantee supplies to the landlocked country. In return, Switzerland retains the right to requisition these ships in times of crisis.

The credit guarantee system was disbanded in 2016 following allegations of fraud and complaints that costs had spiraled out of control.

On Monday, Swiss prosecutors announced proceedings against one ship owner surrounding the award of CHF130 million ($132 million) worth of guarantees. The accused, who has not been identified, denies the charges of forgery of documents and unfaithful business practices.

Switzerland is also in the process of downsizing its merchant navy fleet following a downturn in shipping freight and the emergence of other means to keep the country supplied. The demobilisation process will cost CHF300 million.

At the end of 2016, Switzerland had 47 ocean-going vessels with guaranteed loans totaling CHF794 million. Following the sale of the latest batch of eight ships (announced last month), the fleet will be pared back to 20 vessels, with debt obligations amounting to CHF374 million.

swissinfo.ch/mga